Question

The following transactions occurred during the month of June 2021 for the Stridewell Corporation. The company owns and operates a retail shoe store. 1. Issued 90,000 shares of common stock in exchange for $450,000 cash. 2. Purchased office equipment at a cost of $80,000. $32,000 was paid in cash and a note payable was signed for the balance owed. 3. Purchased Inventory on account at a cost of $180,000. The company uses the perpetual Inventory system. 4. Credit sales for the month totaled $306,000. The cost of the goods sold was $153,000. 5. Paid $4,000 in rent on the store building for the month of June. 6. Pald $2,160 to an insurance company for fire and liability insurance for a one-year period beginning June 1, 2021. 7. Paid $130,050 on account for the merchandise purchased in 3. 8. Collected $61,200 from customers on account. 9. Pald shareholders a cash dividend of $4,500. 10. Recorded depreciation expense of $1,600 for the month on the office equipment. 11. Recorded the amount of prepaid insurance that explred for the month. Required: Prepare journal entries to record each of the transactions and events listed above. (If no entry is required for a transaction/event select "No Journal entry required in the first account field.)

Answer 1

Journal Entries In The Books of Stridewell corporation
For the month of june 2021
S.no	Particulars	Debit	Credit
1	Cash	450000
	Common stock		450000
	( Being 90000 shares issued for cash)
2	Office Equipment	80000
	Cash		32000
	Note Payable		48000
	( Being Office Equipment Purchased )
3	Inventory	180000
	Creditor		180000
	( Being Inventory Purchased)
4	Debtor	306000
	Sales		306000
	(Being Sales made)
5	Cost of goods sold	153000
	Inventory		153000
	(Being Inventory reduced)
6	Rent	4000
	Cash		4000
	( Being Rent paid for Store Building)
7	Prepaid Insurance	2160
	Cash		2160
	(Being Insurance Paid)
8	Creditor	130050
	Cash		130050
	(Being Amount Paid to Creditor)
9	Cash	61200
	Debtor		61200
	( Being Amount Collected From Customer )
10	Dividend	4500
	Cash		4500
	(Being Cash Dividend Paid to Shareholders)
11	Depreciation	1600
	Office Equipment		1600
	(Being Depreciation Charged)
11	Insurance Expense	180
	Prepaid Insurance		180
	(Being Insurance Expenses Recorded)